"In a state like Colorado where there aren't account fees for residents and really low minimums, there really isn't too much of a downside to having multiple accounts," he says.
But families with children who are close in age should be aware that an account can only have one beneficiary at a time. If two children are within four years of each other, having only one account can be problematic when it's time to use the funds, Clemens says. Parents need to think about when they expect each child to be in school.
[Learn how parents are billed for 529 plans.]
A child may only need to use the account for two years if he or she attends a trade school or community college. On the other hand, a child might need to use the account for eight years to pursue a medical degree. The exact number of years students will be in school is hard to predict when they're young.
Parents who want to keep all the money in one fund for a certain amount of time can open an account for the younger child and transfer funds into the second account when they are ready, says Clemens.
The process is simple, says Gil Armour, a San Diego-based certified financial planner. "The parent simply fills out a beneficiary change form, or a partial transfer request from one child to another, and the transfer is accomplished."
The choice of whether to use one account or multiple accounts is a personal decision for families. Parents should consider how they'll divvy up funds among their children when it's time for them to enter college, as well as the rules and fees of their state or of the individual 529 plan accounts.
Trying to fund your education? Get tips and more in the U.S. News Paying for College center.